One of the defining characteristics of a perfectly competitive market is
a. a small number of sellers
b. a large number of buyers and a small number of sellers
c. a standardized product
d. significant nonprice competition among firms
e. an inefficient information system
C
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At harvest time the supply of wheat is perfectly inelastic. If the government taxes wheat at $1 a bushel, then
A) the seller pays the entire tax. B) the buyer pays the entire tax. C) the seller and the buyer split the tax evenly. D) the seller and the buyer split the tax but the seller pays more. E) no one pays the tax because the wheat must be harvested or it will go to waste.
Refer to Figure 15-6. The profit-maximizing output and price for the monopolist are
A) output = 62; price = $24. B) output = 104; price = $20.80. C) output = 83; price = $22. D) output = 62; price = $18.